Here's an update to this story. It looks like according this story,
Intel may be trying to prevent the chipset makers from becoming too
dependent on business from AMD.
By exiting the entry level segment Intel is reducing itself as a
threat to Taiwan chipset makers, and providing them more opportunities
to expand their market presence on the Intel platform. To prevent AMD
from gaining more share, Intel is opening the door for chipset vendors
to increase their chipset production, as well as their market focus, on
the Pentium 4 platform.